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2022
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Recent developments in the confectionery industry
Author:
As one of China’s two traditional pillar snack industries, the confectionery sector has maintained rapid growth, with its potential market share steadily expanding. Over the past five years, the Chinese confectionery market has sustained an annual growth rate of 8% to 12%, and by 2011, the industry had reached a scale of RMB 62 billion.
As China’s confectionery industry expands and grows, internationally, health‑focused, low‑sugar, novelty‑oriented, and eco‑friendly candy varieties are accelerating their collective push into the Chinese market. By contrast, the domestic candy landscape remains strikingly homogeneous. Under the dual pressures of aggressive foreign entrants and intense competition from local players, product development in China’s confectionery sector faces significant hurdles.
Competition among domestic confectionery companies remains largely price‑driven, with significantly less investment in new market segments compared to foreign players. Severe product homogenization undermines the ability of Chinese confectionery firms to compete with international brands, resulting in much lower profit margins and forcing domestic brands to shift their primary battleground to second- and third‑tier markets.
It is worth noting that global per capita annual candy consumption stands at around 3 kilograms, whereas in China it is only 0.7 kilograms, highlighting the substantial growth potential of the Chinese candy market. For domestic companies to break through, the focus should be on product innovation and continuous introduction of new offerings, thereby expanding and diversifying their product portfolios. The Chinese candy industry currently operates within a demand structure characterized by small‑scale products serving a large market, with manufacturers undergoing structural adjustments, product upgrades, natural selection, and corporate restructuring. As the market dynamics shift from product‑centric competition to marketing‑driven strategies, the candy sector is entering an era of brand‑based competition.
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